Business

Scottish politicians have their say on energy, oil and gas and renewables

POLITICIANS across the Scottish political divide have their say on the issues, challenges and opportunities facing Scotland and the UK’s tansition away from fossil fuels as part of our Scotland’s Future series.

HeraldScotland:

Scotland has had the good fortune to be blessed with huge and varied energy reserves. However, we have not seen the full benefits of those vast resources due to the mismanagement of successive UK Westminster governments.

While we are now in the process of ensuring a just transition away from our global reliance on fossil fuels, the UK has failed to ensure there is a proper legacy from decades of exploitation of North Sea oil and gas.

Westminster has used Scotland’s Oil and Gas sector as a cash cow for decades – after adjusting for inflation, the UK Government has taken over £350 billion in North Sea tax revenue between 1968-69 and 2020-21. Other nations have invested in sovereign wealth funds – Norway’s alone is now the world’s largest sovereign wealth fund, and is worth around £185,000 per Norwegian citizen.

The UK, almost alone of oil-producing countries, has no such fund. That failure to ensure a valuable legacy from the North Sea is bad enough on its own – but it is symptomatic of wider failings when it comes to ensuring Scotland, our economy and communities properly benefit from our huge energy resources.

Scotland has among the richest renewable energy producing potential in the whole of Europe – but is unfairly penalised when it comes to the transmission charges applied, giving a direct disincentive to producers and investors.

READ MORE: Scottish Acorn project: How Scotland could ‘go it alone’ with carbon capture project

Similarly, our transition away from fossil fuels has been hampered by the UK Government’s inexplicable decision to snub the Scottish Cluster project when it comes to carbon capture and storage.  

That move is a betrayal of existing Scottish expertise and skills and risks jeopardising the industrial decarbonisation of Scotland, creating an un-level playing field across the UK, and endangering both Scottish and UK-wide net zero targets.

As we set out ahead of COP26 last year, our focus must be on achieving the fastest possible just transition for the oil and gas sector – one that delivers jobs and economic benefit, ensures our energy security and meets our climate obligations.

The Climate Change Committee’s recent advice on enhanced climate conditionality for North Sea oil and gas production supports our positon. However, matters around licensing of oil and gas fields are reserved to Westminster and we continue to call on the UK Government to urgently set out their next steps.

In the meantime we will take forward an approach that supports and protects our energy security and our highly skilled workforce, through the Energy Transition Fund, the Green Jobs fund and Scotland’s £500 million Just Transition Fund for the North-east and Moray. Meanwhile, the ScotWind announcement earlier this year puts Scotland at the forefront of the global development of offshore wind. It will help deliver the supply chain investments and high quality jobs while securing investment in the Scottish supply chain of at least £1bn for every gigawatt of power.

Scotland’s energy sector has a crucial role to play as Europe and the world moves beyond the age of fossil fuel, and we can be a key part of a solution that seeks to ensure energy security amid ongoing economic and geopolitical turbulence. But ensuring Scotland has full responsibility for our own energy policy, which can only come with independence, is central to that goal.

HeraldScotland: Scotland's Future

Liam Kerr, Scottish Conservative energy, net zero and transport spokesperson

HeraldScotland:

RUSSIA’S deplorable invasion of Ukraine has led to turbulence in energy markets and soaring costs. 

Whilst our energy supply is thankfully not dependent on Russian gas, that doesn’t exempt us from the price hikes, and in a cost-of-living crisis we must do all we can to limit price rises as much as possible.

That’s why, now, more than ever, we must safeguard our domestic supply by supporting North Sea oil and gas – not just in the immediate term but for years to come, until growth in renewables means an effective, managed and fair transition can take place.

The UK Business and Energy Secretary Kwasi Kwarteng said it was about “transition, not extinction” – and he is right.

Scotland’s oil and gas sector supports around 100,000 jobs – 70,000 of them in the North-East. We know that the SNP-Green Government would like to end oil and gas extraction pretty much overnight, casting aside these jobs and the communities they support. The personal and wider economic cost would be severe.

Cutting Scotland’s oil and gas sector off before the country is ready would force us to import energy from abroad – leaving Scots with greater exposure to price changes and at the mercy of countries with fewer environmental and safety regulations than the UK.

READ MORE: Why oil and gas production remain key in Scotland’s move to net zero future

Would it help the environment? Absolutely not given that, for example, LNG imported from Qatar has more than double the carbon footprint of local supplies. 

Would it devastate the North-East and Scottish economy, casting thousands of oil and gas workers, the supply chain and related workers on the scrapheap? Absolutely.

Inflicting economic self-harm on the North-East and Scotland whilst increasing the cost of living across the UK is madness, especially when it’s unlikely to help tackle the climate emergency.

Consigning our oil and gas sector to history is not the answer. There is a better way.

A fair and sensible transition towards renewables – the UK Government’s approach – will preserve jobs and keep the lights on in our homes, hospitals and factories. It’s also what people in the North East and Scotland want.

Nuclear power is another crucial source of energy that has been rejected by the SNP-Green coalition, who claim it was a bad deal for consumers.

But how would they know?

The Scottish Government did no impact assessment on the effect of closing and not replacing the plants at Hunterston and Torness on the price of energy for Scottish consumers.

A policy approach which abandons skilled Scottish jobs while simultaneously reducing our energy stocks.

We need our energy provision to be affordable, safe, secure and sustainable – and, at present this cannot be achieved with renewables alone.

It’s high time this government put the student politics aside and took a sensible, pragmatic approach.

A failure to do so will harm us all.

Mark Ruskell, Scottish Greens energy and climate spokesperson 

HeraldScotland:

There are two crises which have put the spotlight on our energy supply. Firstly, the volatile price of gas has plunged millions into fuel poverty, with soaring bills set to hit household budgets hard from April.

Secondly, Vladimir Putin’s power grab which led to his illegal invasion of Ukraine has been built around fossil fuel supply to Europe.

Both of these have shone a light on something we already knew, if we are going to tackle the climate emergency we must reduce our reliance on gas.

Only this week the IPCC gave its starkest warning yet that governments are set to miss climate targets needed to keep the world safe. The International Energy Agency and UN have both warned that new investment in oil and gas needs to end right now for the sake of the climate.

But backed by the same industry giants who helped Putin expand his energy interests, the UK Government is instead calling for even more subsidy for the oil and gas industry, claiming that this will protect energy security.

In the EU, the same corporations in 2014 successfully lobbied for renewable energy and efficiency targets to be watered down. Across Europe this led to a new ‘dash for gas’, at a time when coal fired power stations were closing, locking in dependence on gas for the future.

READ MORE: Why new Scottish nuclear power stations would be ‘catastrophic’ financial decision

One of the most decisive sanctions inflicted on Russia in the wake of the invasion was stopping the Nord Stream 2 gas pipeline between Russia and Germany, a decision made by my German Green colleagues who have recently entered government.

We need to reduce demand for gas and with Greens in government in Scotland we are taking the first steps with record investments in energy efficiency and low carbon heating.

While we are taking action to cut Scotland’s emissions using devolved powers, it is clear Westminster intends to continue with a policy of Maximum Economic Recovery of oil and gas.

But with a quarter of Europe’s offshore renewable energy potential, Scotland could be leading the energy transition across the continent.

With our own seat at the European table, Scotland could be leading efforts to lower emissions and reduce all our reliance on gas, strengthening electricity grids and building new energy markets on a European wide basis. That would undermine Putin’s energy power play, tackle the fuel poverty caused by volatile gas prices and, of course, secure a liveable world for future generations.

Alex Cole-Hamilton, leader of Scottish Liberal Democrats

HeraldScotland:

With rents soaring, inflation on the rise and the Conservative party soon to hike national insurance, there is a cost-of-living crisis hitting the UK. But for most people the most visible sign of life getting more expensive will be energy bills. With the UK government raising the energy price cap from April, analysis by the Liberal Democrats using figures from the Scottish Energy Hub reveals that every area of Scotland is likely to see at least a £990 average rise in energy costs  

Over the past few months, my party has set out a series of proposals for tackling the cost-of-living crisis, from doubling the warms home discount to boosting disability benefits to put more money in people’s pockets. 

At a UK level we have called for a Robin Hood tax on the soaring super profits of oil and gas firms and demanded the scrapping of the hated National Insurance tax hike that will kick households when they’re already down. 

These are measures that will help hardworking families through a crisis but we need to put in place long term solutions too. That means either reducing demand or increasing the supply of cheap, green energy.  

READ MORE: Renewables boom wasted chance without ‘urgent investment in infrastructure’

When it comes to reducing demand, the simplest way to do that is to make homes more energy efficient. We need a massive national effort to retrofit a million homes and make them warm and secure. Then we need a green industrial revolution to boost Scottish renewables and secure the jobs go with it. 

From our islands which have a track record of being at the forefront of renewable energy innovation to the decades of offshore experience in the North East and the engineering yards of Fife and Glasgow, there is a huge opportunity that we must seize with both hands. 

My fear though is that Nicola Sturgeon’s government will let this chance pass them by. Just a few weeks ago, the First Minister was boasting of a “truly historic” opportunity for renewables jobs but when I spoke to the new owners of the BiFab windfarm manufacturing site in Fife, they warned that there aren’t enough trained workers to build even eight turbine jackets among the colossal wind farms of the Forth estuary. 

Worker retraining and getting people to where they are needed is going to be absolutely crucial if we are to make the most of the opportunities afforded to us for job and wealth creation. We cannot afford any more false dawns. 

Alex Salmond, leader of the Alba party

HeraldScotland:

Oil is king.

The king is back and back with a bang. Those who predicted that oil would never see $100 again have found out that the monarch of energy still has plenty of clothes.

Three months ago the mood music of COP26 sent the oil price back down to $70. Now, with war in Ukraine, they are touching $120 and still rising. Gas prices are also on the rise, not as quickly at first but gaining ground.

That’s because to date gas supplies from Russia to Europe are flowing unhindered even increasing while oil shipments are already disrupted as brokers run for cover.

However, as the war goes on the chances of a gas interruption increase and wholesale prices are beginning to reflect that. At some stage it might seem to the advantage of one side or the other to stop it, as opposed to the current “devils bargain” where Russia gets currency, Ukraine gets income and Germany gets gas. All of this in the middle of a war.

READ MORE: Scottish independence: Two oil and gas challenges facing Yes supporters since 2014

I repeat it is only three months since the UK Government looked queasy about going ahead with the Cambo field, Shell Oil deserted it and the Scottish Government declared it wanted no more gas exploration in the North Sea!

Now governments are desperately contacting oil companies to check the prospects of an emergency increase in production as the Government scrambles to boost Europe’s energy resilience. All of which is happening as the average UK household energy bill threatens to reach as much as £3,000.

There are three lessons from the human economic shock and human disaster.

First substituting secure domestic supplies with chancy foreign ones is a fools errand for the environment and represents an own goal for the economy.

Second, instead of closing down the North Sea, every license should now only be issued with a strict condition that the developer contributes to a Scottish carbon capture projects.  Carbon capture potential, like the resources themselves, are an asset which should be productively used. 

Third and most important every new offshore wind field should now be licensed only with a public share. Those who do not learn from history are destined to repeat mistakes. The January ScotWind auction was a disgraceful bargain basement sale of public assets and a mistake which was Made in Scotland.it needs to be sorted in Scotland.

A half century ago the call “It’s Scotland’s Oil” started to resonate through Scottish politics. Unless we act now to make it real “It’s Scotland’s Renewables” will end up as just as empty a boast.

Previous ArticleNext Article

Leave a Reply

Your email address will not be published.